Answered

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The government suffers from the government failure known as informational problems when?

Sagot :

Answer:

Self interested citizens overstate the value of public goods or understate the cost of externalities. This causes government decision to inefficient.

Explanation:

Government fail to correct inefficiency caused due to externalities or public goods because people overstate the cost of externalities and also overstate the value of public goods. In case of public goods, people tend to free ride so they overstate the value of public good.

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